Whitbread gets deal clout with loan

Whitbread chief executive David Thomas called on his bankers and collected a £2bn syndicated loan to back his bid for 3,544 Allied Domecq pubs.

Meanwhile, his rival at unlisted Punch Taverns, Hugh Osmond, formally extended his offer, in cash with a partial alternative of Bass shares, until after Allied shareholders have voted on July 23.

Both sides are arguing over the nuts and bolts but, in crude terms, Allied's 55,000 institutions and private investors are currently looking at the equivalent of 277p for each of their own shares if they go for Punch or 270p if they accept Whitbread.

If Punch wins, Allied shareholders will also have around £68m worth of free call options to buy Bass at 940p. They could sell these and ask for the whole of their Punch payment in cash.

The fund managers who will decide the issue are waiting for the competition authorities to rule on Whitbread's deal. That may not be clear until July 14.